A Walk Through Publix Greenwise Market: Is What Is Sold What Has Been Promised? Lessons For Retailers Thinking Of Launching Specialized Concepts

Jim Prevor’s Perishable Pundit, December 9, 2010

Many years ago, the Pundit’s uncle, Sydney Prevor, who ran the family’s business interests in Puerto Rico, had an idea: He wanted to have a store that would sell rotisserie chicken. The Pundit’s grandfather, Harry Prevor, thought it was a great idea, except he thought it would be a good idea to sell some milk, bread and eggs in the store so that consumers could come in regularly for these staples. And as the consumers would be coming in anyway, why not also stock fruits and vegetables and paper goods, aluminum foil and some frozen foods. By the time the Pundit Grandpa was done, what was supposed to be a chicken store was a little superette with a rotisserie.

And so the Pundit’s uncle has been haunted his whole life by a question: had not his father interfered, would it have been Colonel Prevor rather than Colonel Sanders that everyone came to know?

An unanswerable question. But it did teach us early the issue of product clarity.

A few years back, we were critical of Wal-Mart’s efforts to transform itself. These were the days when Wal-Mart was advertising in Vogue magazine. Our critique really was that it was impossible to do what Wal-Mart seemed to be trying to do: To have one store concept that could appeal to everyone for everything.

We, instead, looked at HEB as an example. It had set up a completely separate concept in the form of its upscale Central Market stores. This allowed for much clearer branding.

In a sense, much of our assessment of Tesco’s Fresh & Easy operation was that the stores struck American consumers as neither notably fresh, nor notably easy, and that left consumers wondering what the store’s purpose or the promise to consumers really was.

We were thinking about these issues as we walked through the Boca Raton, Florida, iteration of the Publix Greenwise concept. It is a nice store. Happens to be right down the block from the Jr. Pundit’s school and close to the Pundit home, so we shop there frequently. The store has a nice foodservice area with a Chinese food bar, grill and pizza oven, and we have often grabbed lunch there as well.

Yet, without any access to the books, we feel comfortable saying that the concept isn’t really a winner. Publix has only three of the stores open, and it opened the first one 38 months ago. Publix is a well-financed company. If it were earning a superior return on investment, it surely would have opened many more Greenwise stores.

Greenwise is also a line of products sold in Publix, and a section in most Publix stores is built around products with words such as organic, natural, healthy and sustainable. So when it opened, Greenwise was portrayed as the answer Publix was offering to Whole Foods.

Yet as we walked around the store and tried to view it from the perspective of someone who had never heard of Greenwise, we came to realize why the stores may not be as successful as they could be. We kept thinking we wanted to check the website of the store so we could understand what the point of the store was.

That is a bad sign. A good concept should be crystal clear to the consumer just through the product assortment, the merchandising and in-store marketing.

The web site actually does make a clear promise to consumers. It explains itself this way:

More and more people today are paying close attention to what they eat. They’re looking for options that are more natural and less processed. They’re trying to avoid additives and chemicals, and seeking products raised in a way they can feel good about. To meet these growing needs, Publix has created Publix GreenWise Market.

All-Natural. Organic. Earth-Friendly.

Yet the store experience isn’t precisely that. As we walked through the store, we saw a lot of upscale epicurean product — but that product wasn’t organic and didn’t promote itself all-natural or earth-friendly. For example, right across from the grill is a big display of products from Flora Fine foods. Nice product, but the promise of the store is not just any old upscale product.

We also found a lot of branding confusion. For example, the bakery — to our eyes the bakery was indistinguishable from a typical Publix bakery and was bannered as a Publix bakery founded in 1957. This caused confusion as we were in Greenwise, not Publix, and it wasn’t clear how the Publix bakery was dealing with the Greenwise promise to consumers.

The Boar’s Head deli did have the Boar’s Head “natural” line, but also seemed to have almost all the conventional products.

Even when the store featured organic items, and it featured many in produce, something was off. It would have both organic and conventional versions of an apple variety, yet there was no effort to persuade consumers that they ought to purchase the organic line or that the organic version was worth the price premium.

To us, the problem we saw in Greenwise was three-fold and it strikes us that retailers, in general, have trouble with separate concepts for the same three reasons:

1) Specialized Retail Concepts Are More Similar to Foodservice Than To Retail

First, Publix has retailing in its DNA, yet doing a specialized market is more like foodservice. Retailers offer customers choice, chefs select out what to offer restaurant patrons. Yet on a concept such as Greenwise, success requires editing the selection to be true to the promise the store makes to consumers.

The store has a beverage department and sells nice teas and juices, specialized sodas made with cane sugar and… Coke and Pepsi. Similar examples can be found throughout the store.

Now there is nothing wrong with choice. As a retailer ourselves, there was scarcely anything truly different from what we were already selling that we wouldn’t try to see if it sold.

But in this type of concept, when consideration is being given to whether to stock Coke or not, the buyers need to go back to the loadstone: Is this “all-natural”?: Is it “organic”? Is it “earth-friendly”? And then the buyers should reject Diet Coke on the grounds that it is not in sync with this concept’s mission.

What about sales, though? Doesn’t the fact that it is on the shelves indicate that it is selling? Probably, but that may not be the way to think about a specialized concept.

Consumers who select a concept because they are “paying close attention to what they eat … looking for options that are more natural and less processed … trying to avoid additives and chemicals, and seeking products raised in a way they can feel good about” may be looking to simplify their shopping experience. They may seek a specialized concept specifically to avoid being tempted by foods that don’t meet these criteria.

After all, modern supermarkets have large numbers of organic, all-natural and earth-friendly products. Anyone willing to make the slightest effort can buy everything they need in this area in many supermarkets.

Yet those who seek specialized markets are obviously looking for a different experience. In the case of an organic, natural and sustainable concept, they probably want reassurance that everything meets these standards. Think of an alcohol rehab facility that offers an on-site bar. It may have high sales for a while but, in the end, the presence of the bar makes potential customers think the concept is less able to get them back on the wagon.

Same idea with a specialized retail concept. If one is selecting a store because one wants to be organic, all-natural and earth-friendly, why would anyone want to be tempted with an area of personal weakness, say Diet Coke.

The most fascinating thing about the store is that it never touts its vision. So in produce, for example, the store will feature a particular apple in both organic and conventional versions. The organic costs a little more. Nothing more is said.

This strikes us as pretty much the correct attitude for a general supermarket but almost the exactly wrong attitude for a specialized concept built around an organic ethos. First, we are not sure why the conventional product is there at all. It is one thing to recognize that people need a balanced diet, and so a store that prefers to sell organic may sell conventional items if organic product of adequate quality and in adequate quantity is not available. But if the organic produce is there, by shopping in this concept, customers are saying that they want it. They probably don’t want to be reminded that there is a cheaper conventional alternative.

But beyond what product is being procured, these consumers want to be sold organic product. They want to be told that it is better and why. They want their inclinations — expressed by choosing the store, reinforced by the marketing.

It seems highly likely that if Greenwise were an independent, it would make this the centerpiece of its marketing. Yet Publix must muzzle this as its executives have not drunk this particular Kool-Aid and so don’t believe it. They are also probably cautious that someone else would pick up on what Greenwise was saying and would use the phrase to attack Publix. These may be good reasons for stopping Greenwise from selling itself as “Better” than Publix, but we suspect that if they can’t market the concept effectively, it will probably fail.

3) Attempts To Leverage The Big Chain’s Procurement And Private Label Programs Make Differentiation Very Difficult.

Publix has a Boar’s Head deli, as does Greenwise. As we mentioned above the deli will feature both Boar’s Head’s “natural” line and its regular product. This raises the same question as we raised about organic and conventional in the produce department. The client has already made a choice in selecting the concept, so selling the “non-natural” product, when the natural is available, is unlikely what the customers want. Even if they buy it, they may feel bad about it when they get home.

More broadly, the ethos of the store simply doesn’t support working with one branded supplier in this manner. The customers want a dedicated Greenwise deli buyer who has selected the roast beef, the turkey breast and the ham that best meets the promise of the store. Are the cows grass-fed? Is the poultry free-range? Is there organic feed? How is the labor treated in processing plants, etc.?

What the customer of a specialized concept wants is to know that everything purchased in the store has been vetted for these values. Yet these are not the key values for Publix, so leveraging the supply relationships will be counter-productive.

The cheese program is very important in stores such as this, yet as best as we can tell, it seems like a distributor program, lacking the unique impact that a Greenwise cheese buyer who internalized the values of the store and was active with the American Cheese Society and the movement to produce and market artisan-produced American specialty cheeses would create.

*****

Basically the issue is a disconnect between the Greenwise brand and the actual products sold in the store. When consumers hit the meat department, they may get cognitive dissonance as there are large signs explaining that if consumers select meat with the Publix Greenwise label, they can be assured the meat was raised humanely, without hormones, etc. But, by shopping in the store the consumers have already said that is what they want — why should any of the meat sold not meet this standard?

Publix is a wildly successful chain. But Greenwise is struggling. The question is likely to come down to whether Publix is willing to let Greenwise be Greenwise.

This is a question all retailers should ask before opening specialized concepts.